Home Trust Company (“Home Trust”) recently announced the creation of Home Bank, along with some other minor changes for Oaken Financial. In this Oaken Blog post, we asked Benjy Katchen — Executive Vice President of Deposits & Consumer Lending at Home Trust — to tell us more about Home Bank, and the additional enhancements introduced to Home Trust’s range of deposit services.
Oaken Blog: Earlier this month Home Trust revealed that CFF Bank, which it had acquired last year, would be renamed Home Bank. Can you tell us why Home Trust implemented these changes?
Benjy Katchen: We made these changes partly for organizational reasons, as it brings the CFF Bank acquisition directly under the Home Trust umbrella. Home Bank will operate as a wholly owned subsidiary of Home Trust, while Oaken Financial will function as a trademark of Home Bank.
More critically, because Home Bank is a Schedule 1 chartered bank under the Federal Bank Act, this now enables us to operate Oaken Financial as a bank. We recognize that for most savers, there is little practical difference between a bank and a trust company, at least with respect to the products and services offered. Having said that, we also recognize that many customers are more accustomed to dealing with a bank, so being able to position one of our issuers this way is something we feel will be appreciated by a wider audience.
OB: What are some of the benefits that customers can expect with these changes?
BK: Home Trust has a long history of providing deposit products, but this has primarily been managed through the broker channel, where individuals work with a financial advisor to invest in GICs or other products offered by Home Trust. In 2013, we introduced Oaken as a direct-to-consumer financial institution, whereby customers can invest online or by phone, or by visiting our stores in Calgary and Toronto or offices in Vancouver and Halifax to arrange an in-person meeting. With the launch of Home Bank, customers can now choose from an expanded offering.
In addition, Home Trust Company and Home Bank are each separate members of the Canada Deposit Insurance Corporation. This means deposits from either issuer are both eligible for CDIC coverage, up to the applicable limits. We feel these actions will help facilitate our future development plans, and will put us on track to better compete with the big banks.
Through Oaken, we’ve demonstrated that we understand how to provide a highly effective online experience. We also understand that a strong digital presence must not come at the expense of customer service, and we remain committed to building on the work we've done with Oaken.
OB: As a current Oaken customer, what impact will these changes have on me?
BK: Apart from providing another deposit issuer, the introduction of Home Bank will have no direct impact on current Oaken customers. Oaken will continue to operate in the same manner as before, and will continue to offer some of the industry’s leading rates.
There was also a small modification completed for existing Oaken Savings Account numbers, which now consist of a new format. All existing customers will receive a letter confirming their new account numbers by the end of August, and these will also appear in all monthly statements going forward. This change to existing account numbers is required for administrative reasons, and prepares the way for the introduction of additional account features in the future.